San Antonio, the seventh most populous city in the U.S., is attracting new residents at an impressive clip – the Alamo City added 24,473 residents between July 1, 2015 and July 1, 2016. During that time, only Los Angeles and Phoenix added more residents.
In fact, all of Texas’ major cities are popular relocation destinations – Dallas, Fort Worth, Houston and Austin all ranked in the top 10 for population gains.
The state is also experiencing extremely strong demand in the healthcare market, with a medical construction pipeline totaling $15.8 billion – second largest in the nation.
Ackerman & Co. was impressed with this extremely active construction pipeline and ongoing investment in new health system facilities. In particular, the $135-million investment by CHRISTUS in the city’s first stand-alone children’s hospital was a key reason the firm decided to team with Artemis Real Estate Partners and MLL Capital on the acquisition of a four-building, 423,411-square-foot MOB portfolio.
Two of those assets – Santa Rosa Professional Pavilion (128,578 SF) and Rosa Verde Tower (123,324 SF) – are on the campus of the newly-renovated and expanded CHRISTUS Children’s Hospital of San Antonio. Rounding out the portfolio, Northwest Towers I & II are on the campus of the CHRISTUS Santa Rosa Hospital – Medical Center.
So, it’s easy to see why Ackerman determined that the four on-campus properties offered a promising investment opportunity. Ackerman and its partners will spend $27 million to reposition the four MOBs into top-tier medical facilities to meet the rising demand for outpatient services.
In addition to the city’s strong demographics and thriving medical market, Ackerman & Co. viewed the $175-million redevelopment of San Pedro Creek – which runs past the children’s hospital and will be transformed into a linear park – as another incentive to expand into San Antonio.
“They’re willing to take their own money and spend $175 million reinvesting in San Antonio. Those are the kinds of communities – thoughtful, forward-thinking communities – we want to do business in,” Kris Miller, President of Ackerman, told the San Antonio Express-News.